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Finra Exam Series-6 Topic 9 Question 71 Discussion

Actual exam question for Finra's Series-6 exam
Question #: 71
Topic #: 9
[All Series-6 Questions]

Mr. R. Retired recently turned 61 and has decided to annuitize a variable annuity contract in which he had been investing. When he does so:

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Suggested Answer: B

When Mr. R. Retired decides to annuitize his variable annuity contract at the age of 61, his accumulation units will be converted into a fixed number of annuity units. The value of these units will depend on the actual returns earned by the account and the actuarially-determined assumed interest rate; it is not fixed. Mr. Retired will not be subject to a 10% penalty since he is over 59 years old.


by Alyce at Feb 13, 2024, 02:41 AM

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Dalene
10 months ago
I believe the correct answer is D, both B and C. Converting accumulation units and fixing the value of annuity units makes sense for Mr. R.
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Daren
10 months ago
I'm not sure, but I think the penalty only applies if he annuitizes before 59 and a half, not 62.
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Ilda
10 months ago
But what about option A? Will he really have to pay a penalty?
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Temeka
11 months ago
I agree, converting accumulation units to annuity units makes sense.
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Daren
11 months ago
I think Mr. R. should go with option B.
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